Not upheld: failure to deliver service, failure to communicate material changes, poor complaint handling complaint against Co-op Funeral Plans Limited

Decision detail

Summary

Mr L purchased a pre-paid funeral plan from Co-op in 2009. Co-op ceased working with the local funeral director in Mr L's area in 2022 but failed to notify Mr L. When Mr L died in May 2025, the estate attempted to redeem the plan but Co-op did not respond promptly and then informed the family that the nearest available funeral director was 140 miles away. The family arranged a local funeral at higher cost (£4,001.11 versus £2,805 plan value). Co-op agreed to refund the difference plus interest, but took over three months to pay. The ombudsman upheld the investigator's view that Co-op should have either notified Mr L in 2022 or assisted with alternative arrangements, and found the agreed financial redress fair, though no additional compensation could be awarded for the family's distress under FOS rules.

The Ombudsman's reasoning

The ombudsman agreed that Co-op failed in its obligations by either not informing Mr L in 2022 that it could no longer reasonably deliver the plan, or by not assisting the estate with suitable alternative arrangements at the time of need. This forced the estate to make urgent arrangements themselves at higher cost. The agreed financial redress (refund of the difference between plan value and actual funeral cost, plus interest) adequately compensates for the financial loss. However, the ombudsman could not award additional compensation for distress and inconvenience experienced by the family and Mr J, as FOS rules restrict such awards to the eligible complainant (Mr L's estate), and the distress was experienced by the family members rather than the estate itself.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website